Pakistan Tehreek-e-Insaf (PTI) is set to present the revised budget for FY2018-19 on Tuesday, September 18 which is being drafted keeping in mind the macroeconomic realities and the unrealistic approach by the previous government in order to gain momentum for the elections.
Earlier it was going to be presented on Friday, 14 September before the Parliament, however, the session has been postponed till next week due to the death of former First Lady Begum Kulsoom Nawaz.
The government aims to cut entitlements enjoyed by the Federal Ministers, Governors and the President.
The Finance Minister Asad Umar plans to make significant changes to the Finance Bill 2018-19, wherein the taxable income will be reduced from Rs 1.2 million to Rs 0.8 million annually. The amnesty scheme is also likely to be revised.
To counter the budget deficit conundrum, the government has proposed a cut in the federal Public Sector Development Programme from Rs 1030 billion to Rs 700 billion along with new taxation measures.
The government also intends to withdraw tax benefits which were awarded to individuals by the previous government weeks before the polls. It can help recover Rs 75 billion losses in revenue.
The previous government’s budget showed a budget deficit of Rs 1.88 trillion which will now increase to Rs 2.4 trillion if proper measures are not taken. PTI’s policy is to increase revenue collection at the import stage by countering misdeclaration of goods, under-invoicing and smuggling while increasing customs and regulatory duties to increase the revenue collection by 20% in the FY-2018-19.
The Finance Minister is also expected propose to withdraw the tax-free entitlements of the high courts and supreme court judges. The judges continue to enjoy these tax-free perks even after the retirement.
The government is also expected to increase duty on mobile phone imports to increase the revenue collection. Earlier, ProPakistani reported on how these duties will impact the Mobile Phones prices in Pakistan. Similarly, the government is working on preparing a list of general non-necessary items on which the duty will be increased.
PTI’s focus is to curb imports while increasing the exports in a bid to lessen the trade deficit. For this reason, the government is mulling over reducing the age limit of imported jeeps to 3 years and for cars to 2 years, from 5 and 3 years respectively.
The PML-N government also worked on the withdrawal of tax exemptions, however, it later dropped the idea.
The government is ready to make some tough decisions which might impact the general public big time, however, the economic situation of the country demands these decisions to be implemented at the earliest.